I got up this AM and it was raining in Arnold. Almost forgot what rain was like. Over the past two years, you have been doing an incredible job at reducing the use of water and the results still stand strong in favor of conservation.

Applause!!! ….and….more APPLAUSE! The Water Company three years ago initiated a search for additional water sources. At the time, there were no contingencies for or if the well(s) failed. Water experts were called in and 12-18 sites in the Arnold area for possible wells sites were identified. The vast majority of those were explored in varying degrees and the end result was overwhelmingly disappointing… Only two of the sites revealed a usable water flow.

We were trying to develop a back-up or redundant system, yet the meager results failed to stand the test. In addition to the searching for wells, we found it necessary to reach out to adjoining water companies, to explore options. There are only two: one was cost prohibitive and one was willing to negotiate. Success came with a recently signed agreement with the Calaveras County Water District (CCWD), for the purchase of wholesale water. CCWD will provide, on a contractual basis, a sufficient volume of water, at a minimum of 45,000 gallons per day (gpd) for a fixed rate. This volume will `power’ ½ of the BLS subdivision. The other ½ will be serviced by our wells. (In times past, from 1998-2011, the two areas had water delivered in this manner.) BLSMWC becomes a single customer of CCWD and in turn provides water to our rate payers.

Your only connection with CCWD is the product. What else does this mean? Our wells will last longer and we have a secondary source for emergencies. Our main well is now 28 years old, on an average life span of 30-35 years. Shortly a new well will be coming on line and there is one additional well in process. We plan to continue well service and the search for newer well sites will go forward.

Other advantages of this new agreement include access to a larger supply connection for use in firefighting needs, additional volume of water should any expansion of the BLS development occur and a badly needed back-up system in the event of any form of a well malfunction. What does all this cost? The search for wells, over the past two/three years has reached 1,364,000. This relates to $674.00/shareholder.

The one time buy-in cost to CCWD is $825,000 in capacity/connection fees and relates to $407.00/shareholder. This is 40% less than the well cost. The annual cost of wholesale water is projected to be $85,000/year or an annual cost to the shareholder of $42.00/yr. Some of the annual water cost of $85,000 will be off-set by the savings from less demand on the wells and related reduction in well services: chemicals, necessary electrical power, required maintenance, etc. I would anticipate the saving to cover about 25/30% of the $85,000.

The overall cost of this contract/project will be paid from current Water Company funds. Meanwhile the business of water continues. The metering project is coming along and more meters are being added to the system. Remember we are charged by the State of California Water Resources Board to meter our entire system. (All Water Companies in California are required to do so.) We are also continuing the process of examining alternate funding for the completion of the infrastructure’s piping replacement.

You must be wondering, with all that is going on, will the annual water rates increase. Yes they will. We are currently working on the 2016 Annual Budget and there will be a rate increase factored into it. Over the past eight years, the rates have increased about 3.5%/yr. The Board will be reviewing the proposed budget at the November 14th monthly meeting. Immediately following the monthly meeting on Saturday the 14th, at 11:00 the Board will hold an open, informational meeting to cover the CCWD agreement and answer any questions concerning it.

I would encourage you to attend. In closing, I want to thank the Board and Staff, which includes legal counsel, for their attention to duty on this partnership project with CCWD. The result guarantees water delivery in the future.